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Construction in lockdown – except ‘urgent’ works

21 July 2021

#Construction, Infrastructure & Projects, #COVID-19

Construction in lockdown – except ‘urgent’ works

Over the weekend, the NSW Government introduced new restrictions effective from Monday (19 July) which provides that all construction works are to be paused across the Greater Sydney Area for two weeks (Public Health Order). The only exceptions are for “urgent” works. The Greater Sydney Area to which the Public Health Order applies includes the Central Coast, Blue Mountains, Wollongong and Shellharbour areas.

In this update, we provide some guidance on what construction work can and cannot be performed during this lockdown and actions you should be taking according to your contract.

What is urgent work?

The Public Health Order provided that only “urgent” work may proceed. Therefore, contractors should be cautious when interpreting the term “urgent”.

Work will not be considered urgent simply because the timing of your works program is tight. If you proceed to carry out work on this basis alone, you risk a fine.

The NSW Government has provided the following qualifications to assist in determining what work is considered to be urgent or otherwise exempt from the Public Health Order, namely work:

  • to ensure the safety or security of the construction site
  • to deal with environmental risks
  • to maintain and ensure the integrity of critical plant, equipment or assets, including partially completed works that would otherwise deteriorate
  • to receive deliveries of supplies that would otherwise deteriorate
  • to maintain public utilities
  • to ensure the safe operation of existing transport infrastructure
  • performed by or on behalf of NSW Health in response to the COVID-19 pandemic
  • required because of an emergency.

Residential construction

The restrictions do not just apply to commercial projects – work on residential buildings (including renovations, alteration and additions to existing residential buildings, and new builds) are also to be paused, except where permitted under the above exemptions.

Time and delay

If you are currently working in the Greater Sydney Area, your works will likely be delayed. If you have not done so already, you should give notice of this delay to your Principal/Principal Contractor and follow this up with a claim for an extension of time if your contract so requires.

If the contractor is required to notify the Principal if they become aware of anything that will probably cause delay, then to ensure you retain your entitlement to claim an extension of time, you should issue such notice promptly and within any stated time limits. When giving the delay notice, you should state the anticipated duration of two weeks and include a comment that a further notice will be issued if the shutdown is extended.

You should also consider submitting a claim for an extension of time or seek a suspension of the works for the duration of the lockdown. Such a claim should be submitted even if it is not clear under your contract that you are entitled to an extension of time for such delay. Superintendents and Principals often have a discretion in a contract to grant an extension of time. Should the lockdown be extended, you should submit a separate delay notice and subsequent claim for an extension of time.

In addition, if you are entitled to make a claim under your contract, submit a claim for delay costs. It is important that you comply with the notice and any other requirements in your contract when submitting the claim, and take note of any time bars – otherwise, your claim may be invalid.

Security of Payment legislation

The Public Health Order contains no provisions which affect, extend time under or otherwise ‘pause’ the operation of the Building and Construction Industry Security of Payment Act 1999 (NSW). Therefore, contractors should continue to operate under this legislation as normal and not defer dealing with payment claims and payment schedules.

Comply with other public health orders

If you carry out works during the lockdown (to the extent allowed under the exemptions), contractors are reminded to follow other health orders, such as wearing facemasks and employing appropriate social distancing and COVID testing measures.

Authors: Christine Jones, Tony Britt, Krishneel Kumar & Nicholas Achurch

The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.

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